Bank of Japan Governor Masaaki Shirakawa said Thursday that transparency of prices will help futures industry to improve and perform indispensable functions within the society.
"There may be many areas in which prices determined on futures exchanges could become benchmarks for related economic activity," he said during a speech at a conference hosted by the Futures Industry Association in Tokyo.
"The recent attention over the setting of LIBOR seems to confirm such a view," he added.
He noted that such positive contributions should confirm that the futures industry will continue to perform useful and indispensable functions within the society.
According to him, one of the main reasons why many commodity futures in Japan are not flourishing is that most of the futures markets are not successful in attracting sufficient amount of non-speculative activity. The market might take care of the balance between speculative and non-speculative activities, Shirakawa said.
Meanwhile, Reuters quoted the governor as saying in the Parliament on Thursday that libor scandal is a serious problem that could hurt the fairness of the financial markets.
by RTT Staff Writer
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